An advisor to the European Central Bank (ECB) is defending the decision to make Amazon one of the five companies to test a digital euro.
“The prototyping experiments for the front end are driven by technological considerations,” Jürgen Schaaf said at a panel hosted by the Association for Financial Markets in Europe, per a Wednesday (Sept. 28) report by CoinDesk. “The companies that have been chosen for that five were the most appropriate in terms of the needs that we have for technological tests and experiments.”
As PYMNTS reported earlier this month, Amazon was one of five companies the ECB chose for a “prototyping exercise” that will be part of the bank’s two-year investigation phase into a central bank digital currency (CBDC) that could provide an alternative to cash.
Learn more: Amazon, Nexi, Worldline, CaixaBank, EPI Join Digital Euro Project
Joining Amazon are Nexi, Worldline, CaixaBank and the European Payments Initiative (EPI), all picked from a pool of 54 potential developers that responded to an ECB call for participants.
The goal of the pilot is to test how well the technology behind a digital euro integrates with the prototypes created by participant companies, with each company focusing on specific use cases of the digital euro.
“Simulated transactions will be initiated using the front-end prototypes developed by the five companies and processed through the Eurosystem’s interface and back-end infrastructure,” the ECB said in a Sept. 16 news release.
Amazon’s job will be to develop eCommerce payment prototypes, but Schaaf told the panel the results of this work would not automatically feed into the follow-up experimental phase. This could suggest that Amazon would not continue to have favored access, per the report.
Schaaf added that the digital euro could help ensure Europe’s autonomy in the payments market, and pointed to the risks if sanctions imposed from abroad hamstrung the European Union economy by limiting transactions. However, he said he didn’t want to see a “political” exclusion of U.S. firms.
“Our wish to strengthen our monetary autonomy with a digital euro does not mean that Europe would shut down all its gates for retailers from abroad,” Schaaf said. “There’s no protectionist intention behind that.”
The ECB is expected to publish its findings on the first phase of the project when it wraps up in the first quarter of 2023.
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